Rystad Energy - Energy Knowledge House

Press release

Barents Sea: Norway’s new oil province

Share by Email Share on Facebook Share on LinkedIn Share on Twitter

Author: Espen Erlingsen, VP Analysis

Publisher: Offshore Magazine

The first Norwegian Barents Sea exploration well was drilled in 1980, and since then about 130 wildcat and appraisal wells have been drilled in this province. Over the last five years, the exploration effort has started to pay off and when this success is converted into investments and production, the Barents Sea will be an exciting province on the Norwegian Continental Shelf.

Figure 1 shows the discovered volumes in the Barents Sea by discovery year. In total 4 billion barrels of oil and gas were discovered in the province year to date where 1.8 billion barrels are liquids.


Snøhvit was the first Barents Sea discovery in the beginning of the 80’s. This was a large gas discovery located in several reservoirs. Due to the remote location of the gas and the difficulties to get it to the market, almost 30 years passed before this field started commercial production in 2007. Production from the field is exported as LNG and there were problems with the liquefaction train, which kept the production low for several years. The troubling past seems to be behind the project; in 2015, the field achieved the highest production yet to data exporting more than 5 million tons of LNG.

The second largest discovery was Goliat in 2000. The Eni operated field includes 200 million boe (100 % oil) of resources and developed as an FPSO. Goliat commenced production in March this year after being delayed for several years and incurring over 50% cost overruns.

Eleven years after the Goliat discovery, exploration results started to improve again with the discovery of Johan Castberg in 2011. This discovery consist of two primary reservoirs called Skrugard and Havis. Initially Statoil, the operator, planned to develop the discovery with a floating platform (TLP) connected to an onshore terminal. After the discovery of Castberg, Statoil initiated an exploration campaign in the close proximately of the field. The purpose was to find additional resources and improve the economics of the TLP development solution. The campaign was unsuccessful and in combination with the falling oil price, the partners changed the development concept to an FPSO. The new development concept and current low unit prices have reduced the breakeven price  from 80 to 45 USD/bbl.

In 2013, two new discoveries were made. OMV discovered Wisting Central, while Lundin discovered Gohta. Combined, the total discovered resources for 2013 was just below 0.5 billion boe, making Barents Sea the province in Norway with the highest discovered resources in 2013.

Barents Sea was also the leading Norwegian exploration province in 2014, as Lundin made the Alta discovery, while OMV made the Hanssen discovery. With these additional volumes, the most likely development solution will be FPSO at Alta/Gohta and FPSO and Wisting/Hansteen.

The table below shows the main Barents Sea projects, with key information, resources and estimated breakeven price.

In terms of production, the Barents Sea will grow considerably. The first growth phase will be in 2016/2017 as the Goliat production is ramping up. Figure 2 shows historical and forecasted production for this province. The next growth phase will be in the beginning of the next decade. With the anticipated startup of Castberg, Wisting and Alta/Gohta, the total Barents production may go beyond 500 kboe/d. This is about five times higher than the current production. The growth in production will be driven by oil, as the latest discoveries has been oil discoveries. To achieve this production growth substantial investments are needed. Historically, annual investments for the Barents Sea have been just below $2 billion. After 2020 this number is expected to grow and reach above $8 billion. Most of this spending will go to subsea equipment, rigs and FPSO construction.

For many years, Snøhvit was the only producing field in the Barents Sea. However, this picture will soon change. The recent exploration success will most likely lead to an investment cycle, resulting in large growth in both spending and production. With these new projects, Barents Sea will certainly become an important production province and could contribute to as much as 15% of the total Norwegian production at the end of the next decade.

For link to article, click here


Article Contacts

Espen Erlingsen, VP Analysis
Phone: +47 24 00 42 00

Julia Weiss, VP Marketing
Phone: +47 48 29 87 61

About Rystad Energy

Rystad Energy is an independent oil and gas consulting services and business intelligence data firm offering global databases, strategy consulting and research products.

Rystad Energy’s headquarters are located in Oslo, Norway. Further presence has been established in Norway (Stavanger), the UK (London), USA (New York & Houston), Russia (Moscow), Brazil (Rio de Janeiro) as well as Singapore and Dubai.